The recent economic slowdown has middle-market companies reassessing their relationships with insurance brokers and adopting a more basic approach to securing insurance coverage.

In the past, middle-market companies have selected their insurance brokers based on the quality of customer service provided by competitor firms. Middle-market companies tend to reward brokers that provide high levels support due to the lack of specialized risk management professionals employed by larger corporations, Recent research data gathered in the Greenwich Associates’ 2008 Middle Market Insurance Research Study revealed that companies began de-emphasizing broker customer service in favor of a straightforward approach on obtaining the best value and price in customer’s insurance purchases.

Greenwich Associates defines “middle market” as companies with $10 million to $500 million in annual sales. The firm conducted more than 18,000 interviews with U.S. as well as 1,500 large companies around the world a part of its 2008 Global Large Corporate Insurance Study middle-market companies as part of its 2008 study. the results of which will be released later this month.

Greenwich Associates asked companies to enumerate their insurance brokers and the respective carriers, and to rate both their satisfaction and their willingness to recommend these providers to other companies. Companies were asked to evaluate brokers and carriers on 25 categories in the research.

Greenwich Associates creates a statistical analysis that reveals the qualities and capabilities of brokers and carriers that are regarded to be recommendable. This analysis reveals the factors that are driving corporate perceptions and decisions about insurance carriers and brokers.

Over the past few years, customers rated customer service as the most important factor in middle-market companies’ assessments of their insurance brokers. The results of this year’s research and analysis reveal that companies are now giving equal weight percentage to three main factors: price, value and customer service quality.

This study is further evidence of the deterioration of the economy and the revenue and cost pressures faced by U.S. companies. In these tough times, companies can no longer afford to overpay for insurance coverage.

The study also reveals that companies are becoming less willing to rely entirely on carrier recommendations from their brokers and more inclined to research the capabilities of individual carriers on their own. As a result, companies increasingly are holding brokers accountable for the carrier recommendations they make.

Conclusion:
Companies are giving less consideration to brokers’ ability to provide general risk management advice and their overall problem solving ability. Based on these findings, he recession is forcing middle-market companies to be much more diligent and meticulous putting more emphasis in getting high quality coverage and service for the best possible price.